Toll slips past minorities, takes charge of Tranz Rail

Toll Holdings' shares reached a 12-month high yesterday as the transport company moved to take operational control of New Zealand freight operator Tranz Rail, despite not fully completing its takeover.

Toll has relocated two senior executives from Melbourne to Auckland to start running Tranz Rail and has appointed a new five-member board, with three Toll directors.

Toll managing director Paul Little said yesterday Toll had acquired about 84 per cent of Tranz Rail by Friday, 6 per cent short of its original conditional target of 90 per cent acceptance.

Toll waived that condition on Friday and extended its $NZ1.10 offer to November 7, a Friday. "We're talking to the couple of NZ institutions who control a big percentage of the outstanding shareholdings," Mr Little said. "At the same time we are still putting our own people in to run the business."

He said that with the condition removed, Toll had another 60 days under NZ law to complete the acquisition of the remaining shares. However, Toll was confident of achieving this in 30 days.

Tranz Rail's existing chief executive, Michael Beard, resigned last week. The two Toll executives who will run the company are David Jackson, the new managing director, and Austin Perrin, chief financial officer.

Mr Little said Tranz Rail would also be renamed, but no name had yet been chosen.

A new Tranz Rail board is now in place chaired by a Toll appointee, Mark Rowsthorn. Mr Jackson and Mr Perrin are also on the board.

Mr Little said two Tranz Rail directors would stay on the interim board while Tranz Rail was a listed entity. "It's difficult to say how long it will be in place."

Mr Little said Tranz Rail's Wellington passenger train network was not part of Toll's long-term plans. "We have undertaken that we will not do anything in the short term to disrupt the passenger service, but long- term we will sell it," he said.

Mr Little said Toll had no plans to divest a tourism-related passenger service on the main trunk line which is run as a joint venture with the Government.

Also, there were no plans to sell the passenger services on the ferries that ran between the North and South islands.